Pressure builds for ICAC to suspend coal licences

By Sean Nicholls, Kate McClymont

21 November 2012 — 3:00am

THE state opposition has joined the Greens in calling for the suspension of coal licences issued by the former Labor minister Ian Macdonald that are being investigated by the Independent Commission Against Corruption.

The commission is examining the circumstances surrounding the issuing of licences at Mount Penny, Glendon Brook and Yarrawa as part of what it has described as the largest corruption investigation in its history.

"We want to make sure that no one can benefit or profit from these licences and the way they have been issued until the ICAC has reached its conclusions" ... John Robertson, NSW Opposition leader.

Photo: Dean Osland

The ICAC has heard the family of another former Labor minister, Eddie Obeid, stood to gain as much as $100 million from the issuing of the licences.

It is due to examine the issuing of another licence at Doyles Creek next year. The licence was awarded without tender to Doyles Creek Exploration, a company chaired by John Maitland, a former national secretary of the Construction, Forestry, Mining and Energy Union who also had an 11 per cent shareholding.

Last week, after evidence given at public hearings, the Greens MP Jeremy Buckingham called on the Energy and Resources Minister, Chris Hartcher, to consider legislation to suspend the Mount Penny licence.

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The Opposition Leader, John Robertson, said on Tuesday he wanted the government to go a step further and suspend all licences being examined by ICAC.

''We want to make sure that no one can benefit or profit from these licences and the way they have been issued until the ICAC has reached its conclusions,'' Mr Robertson said.

However, Mr Hartcher accused Mr Robertson of ''gross hypocrisy'' and being ''mute'' on the issue while in government.

''The NSW government will do everything possible to ensure taxpayers' interests are protected and anyone who engages in corrupt conduct doesn't profit from it,'' he said.

''ICAC has full discretion to come up with any findings or recommendations which the government will duly consider and act on as appropriate.''

The mayor of Muswellbrook, Martin Rush, said suspension of the licences would be ''overwhelmingly well received'' by residents. The Yarrawa and Doyles Creek licences cross the Musswellbrook local government area while the Mount Penny licence adjoins it.

A spokesman for NuCoal, which took over Doyles Creek Mining in 2010, said it acquired the licence in good faith.

''On that basis we will continue our exploration activities as required under the NSW Mining Act,'' he said. ''Meanwhile, we will continue to co-operate with the ICAC inquiry as and when required."

The commission heard on Tuesday that despite never having mined for a single lump of coal and being a uranium miner, Monaro Mining was awarded six of 11 coal exploration licences, three of which are the subject of the inquiry.

Internal Monaro documents reveal that it had been given inside information that it would win the tenders. Julie Moloney, a senior departmental officer who sat on the evaluation committee, told the commission on Tuesday that it was not up to the committee to decide if the bidding companies actually had the capacity to fulfil their tender.

The commission has heard that Monaro did not have the experience, the skills or the money to pursue one exploration licence, let alone to win six licences.

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Ms Moloney said ''it wasn't part of our brief'' to consider the financial viability of tendering companies and it was up to the minister to decide if a company had the capacity to do the work as promised.

At the last minute Monaro got cold feet and pulled out of the tender process. Its bid for Yarrawa was transferred to an Obeid-related company. The Mount Penny licence went to Cascade Coal, after the minister controversially ordered the tender process to be re-opened. Cascade subsequently paid the Obeids $30 million with the promise of a further $30 million.